VLCC pool, Tankers International continues to expand with the addition of Lila Global and its VLCC, Lila Kochi. This new partner reinforces Tankers International’s position as the premier provider of VLCC pooling globally.
Lila Global, a leading logistics and freight services provider headquartered in Dubai, has been actively expanding its presence in the tanker market in 2025. The addition of Lila Kochi, with a DWT of 313,798, follows a series of acquisitions across the product and crude tanker segments, reflecting the company’s long-term, countercyclical strategy in shipping.
Tankers International’s VLCC Pool currently comprises of 29 vessels, with 8 pool partners. As the market continues to evolve, the company’s pooling model remains critical in navigating complex trade routes and delivering competitive returns.
Pool partners can benefit from improved cash flow, access to longer and more profitable trades, and greater operational efficiency. Tankers International maximises earnings potential by leveraging the collective scale, data, and expertise of its entire fleet.
Charlie Grey, Chief Operating Officer at Tankers International, commented: “We are pleased to welcome Lila Global as a new pool partner. As the VLCC market becomes increasingly volatile and fragmented, the value of pooling is becoming increasingly powerful. Our VLCC pool is designed to adapt to these dynamics and deliver consistently strong performance. The addition of Lila Kochi and a partner like Lila Global supports our strategy of combining scale with quality tonnage and owners who are looking to maximise their exposure to the spot market, particularly at a time when fundamentals point to a strong freight market going forward.”
Faidon Panagiotopoulos, Head of SNP at Lila Global commented: ”Our strategic return to the tanker sector aligns perfectly with Tankers International’s commitment to operating VLCCs in a safe and efficient manner, irrespective of market conditions. We are confident that this new partnership will benefit all pool members and assist them to maximise shareholder returns, by utilising quality assets regardless of age.”
By pooling vessels, owners benefit from the commercial advantages of spot trading, by professional management, operational efficiency, and risk diversification. This model offers scale-driven returns and a more stable earnings profile, while preserving the upside that time charters often limit.
In the first episode of our new podcast Tanker Talk! Freight and Fundamentals, we explore the performance of the VLCC market in the first half of 2025 and our predictions for the future for the market. In the podcast, we dive into the macro and micro dynamics driving today’s market.
Despite geopolitical uncertainties and a slower pace of global oil demand growth, VLCC freight rates have seen a rebound compared to the latter half of 2024. One key driver has been the shift in global trade flows due to the emergence of Brazil as a major export hub to China. As retaliatory tariffs strained US to China crude flows, long-haul volumes from South America helped offset tonnemile losses and supported VLCC utilisation.
In the podcast, we also examine OPEC+ dynamics, from voluntary production cuts to rising output from select members, and how this influenced fixture activity in the Arabian Gulf. We unpack how geopolitical tensions, especially around sanctioned producers like Iran, are reshaping tanker operations and routing preferences.
Lastly, we assess VLCC fleet fundamentals, including low newbuild orders and inflated fleet size due to reduced scrapping, and what they signal for the supply-demand balance going forward.
Tune in to hear why the VLCC market is poised for a potentially strong second half of 2025 and how shifting trade patterns, regional risk, and evolving fleet dynamics are creating a bullish outlook.
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The VLCC freight market has gained momentum in the first half of 2025, with earnings generally higher compared to the latter half of 2024. This improvement comes despite various uncertainties and evolving market dynamics, illustrating the market’s resilience.
One significant driver has been the impact of tariffs, particularly the threat of US tariffs on China. This has led to a decrease in VLCC liftings from the US to China, impacting tonne-miles due to the long-haul nature of this route. In general, VLCC volumes out of the US have declined overall, indicating that American crude oil has been exported on smaller tankers to more localised markets.
The return of OPEC+ voluntary production cuts also played a role in market dynamics. While headline figures point to rising output, much of this increase has been masked by some countries compensating for prior over-production. Additionally, the increase in supply also coincides with regional demand peak in the Middle East. This means we have not seen a significant change in exports from this supply growth. However, mainstream VLCC fixture counts in the Arabian Gulf have shown an upward trend. Looking ahead to the second half of 2025, more barrels will become available for exports as over-producers catch up with targets and seasonal local demand begins to fade.
Sanctioned crude producers, particularly in Iran, continue to disrupt the market. While Iranian exports have been at high levels, the recent escalation of hostilities between Iran and Israel has heightened significant geopolitical risk. Tensions over the Strait of Hormuz, a crucial geopolitical chokepoint, have led to increased insurance premiums and a potential shift in charterer preferences for alternative loading regions. Although the recent ceasefire has brought a measure of stability, the region remains a source of potential volatility for oil flows and tanker operations. Any renewed tensions could be capable of swiftly altering market dynamics.
On a more positive note for VLCCs, South America, especially Brazil, has emerged as a significant growth area. Increased crude supply, combined with tightening sanctions on dark fleet tankers and China’s retaliatory tariffs on US crude, has led to a substantial rise in VLCC shipments from Brazil to China. These long-haul voyages are highly supportive of tonne-miles, reinforcing the region’s growing strategic importance in global trade flows.
Global oil demand continues to rise, albeit at a slower pace. China remains a key driver for the VLCC segment, and despite macroeconomic pressure and a slowdown in demand growth, its crude imports have taken an upward trend. There’s a positive sign as China’s refinery maintenance season concludes, potentially leading to more crude oil entering their refining systems. Furthermore, mainstream tanker demand into China has increased, with a notable rise in movements from long-haul load areas like West Africa and South America. Early indications also suggest a decline in sanctioned VLCC trades into China, which could further benefit the mainstream market.
The overall VLCC fleet size remains somewhat inflated due to the continued sales of older vessels to the dark fleet, leading to historically low scrapping rates. However, the orderbook for newbuilds is relatively small. This combined with ongoing oil demand growth, contributes to a generally bullish sentiment for VLCC market microeconomics.
Looking ahead, the VLCC market appears poised for a strong second half of 2025. Geopolitical tensions, notably the Iran-Israel conflict, could continue to drive supply chain disruptions. However, shifting trade patterns due to US tariffs are redirecting long-haul VLCC routes towards growth regions in South America, generating similar valuable tonne-miles. Furthermore, as OPEC+ voluntary production cuts translate into increased actual export volumes, these additional barrels will undoubtedly boost demand for the VLCC segment. Together, these factors indicate a positive trajectory for the VLCC market in the coming months.
Our CEO, Charlie Grey, was featured in Logistics Middle East, where he unpacked an interesting trend the VLCC market is currently facing, particularly in the Middle East.
Charlie noted, “In the first half of 2025, the Middle East Gulf accounted for about 210 VLCC loadings per month out of a global monthly average of around 320 cargoes, excluding sanctioned volumes.”
However, while volumes are up, freight rates have yet to reflect this momentum. Despite OPEC+ signalling the easing of voluntary production cuts, export figures have not yet surged in parallel. This can be attributed to two key factors:
➡️ Domestic summer demand in exporting countries absorbing supply. ➡️ Overproducing nations are adjusting previous output surpluses, temporarily capping net export growth.
As summer ends and domestic consumption eases, more crude is expected to hit global markets. Once overproducers realign with OPEC+ targets, a significant increase in seaborne volumes could follow, potentially driving a VLCC demand rebound.
With market dynamics evolving and the spot market gaining favour among shipowners, we see a structural shift – fixed Time Charters are giving way to more flexible, upside-focused Spot Market plays, backed by commercial tanker pools like our Tankers International VLCC Pool.
Charlie added, “Pools combine the earnings potential of spot trading with professional commercial management, operational efficiency, and risk diversification.”
Geopolitics and supply shifts drive sustained VLCC demand from Brazil to China
The combination of rising Brazilian crude supply, shifting geopolitical dynamics, and price-sensitive Chinese refinery demand has led to a significant increase in VLCC shipments from Brazil to China in recent months.
Several new FPSOs (Floating Production Storage and Offloading units) came online at the end of 2024, enabling Brazil to steadily ramp up its crude oil production and exports in early 2025. According to data from Vortexa, Brazilian crude exports rebounded sharply in March to nearly 2 million barrels per day (mbd), after hitting a seasonal low of just 1.3 mbd in January.
Our proprietary fixture data reflects the rebound. VLCC liftings from Brazil to China have increased steadily this year – from just five in January to 14 in March – with this elevated activity sustained through April and May. This follows a downward trending VLCC cargo count throughout most of 2024, on the back of Chinese refiners buying more sanctioned Iranian oil and using dark fleet vessels to transport these barrels, diverting demand away from mainstream markets.
Several market forces are contributing to the recent upward trend. One key driver is the tightening of US sanctions targeting the dark fleet tankers linked to Iranian and Russian trades, as well as “teapot” refineries that have traditionally imported discounted sanctioned crude. With these low-cost barrels no longer accessible without the risk of facing a penalty, some refineries have turned to alternative mainstream sources. Brazil is a natural candidate.
Adding to the momentum, China’s 10% retaliatory tariffs on US crude imports continue to make American barrels uneconomical for Chinese buyers.
In March, Saudi Arabia raised its official selling prices to Asia, further straining the budgets of price-sensitive refiners and encouraging a shift to more affordable Atlantic Basin grades. Brazil’s growing export availability met that demand at the right time.
While a round voyage from the Middle East to China typically takes around 60 days, the Brazil to China roundtrip could take 100 days and more. This longer sailing duration locks in vessels for extended periods, tightening available tonnage and lending support to VLCC freight rates. As more ships are committed to the Brazil to China route, the knock-on effect benefits the wider VLCC market.
Looking ahead, the outlook remains positive for VLCCs. While OPEC+ may gradually ease production cuts and Asian buyers could resume more purchases from the Middle East, so far as we enter June, our fixture data already shows that at least 14 cargos are scheduled to be loaded from Brazil to China in June if they discharge as reported. If Brazil continues expanding its crude production, we expect the Brazil to China VLCC flow to remain strong, providing continued support and demand for VLCCs in the months to come.
In a nutshell, what is your role at Tankers International?
I sit on the chartering desk at Tankers International (TI) along with a dedicated team of 4 charterers; 2 in London and 2 in the US. I am responsible for negotiating and facilitating fixtures for the VLCCs within the pool, the size of which means working with a large range of customers and, therefore, a large and diverse cargo portfolio.
It is the combination of our team’s collective hard work and our global presence that achieves better scheduling of the fleet and ultimately a higher laden versus ballast ratio for all the vessels. I also ensure that the voyages are profitable, are in line with our forecast for the market going forward, and that they adhere to international regulatory compliance standards.
How did you get here?
Shipping has always been part of the family, with my father working in the clean tanker segment for 45 years. This close connection to shipping inspired me to study Maritime Business at Southampton Solent University. Straight after getting my degree, I got a job at Poten & Partners, beginning in the operations department before working my way onto the VLCC spot desk. I really enjoyed putting the theory I learnt at university into practice. The dynamism and high stakes of the VLCC market are an added bonus.
Knowing that I wanted to remain in, and pursue the VLCC sector, I was very keen to work at TI, given that it is the world’s largest VLCC pool. It truly is a global role – from waking up with messages from brokers in Singapore, to working on quotes for cargos for Asian clients, and closing the day with the Americans. It is an industry where no one day is the same and that’s what makes it such an exciting and enjoyable one to be part of.
Diving deeper into your role, how does data support you and therefore, the commerciality of the pool?
Data gives us critical insights into the market and the current rates.
Having a database with 100,000 historical VLCC fixtures, each with 40+ data points also means that, as a chartering desk, we’re completely in tune with the market. Being informed about market fixtures gives us a solid starting point for our own deals, allowing for smoother negotiations.
Additionally, this knowledge empowers us with accurate market value and prevents us from being lowballed. As the saying goes, knowledge is power!
The historical data that TI has collected on vessel performance is immensely helpful when setting up a fixture. We’re able to look at the previous performance of the vessel and anticipate any issues that it might run into. This enables us to be proactive in scheduling any repairs that may need doing instead of going in blind and being on the back foot.
For the industry to truly unlock the power of data, companies must invest in training staff to understand it. At TI we do just that but, as an industry, we mustn’t underestimate how important it is to deploy proper training for people to effectively collect, analyse, and apply data insights.
How has TI’s approach to fixing vessels changed over the past 2 years
We see fixtures as providing not only profit, but also valuable data points. TI has been collecting data since its inception in 2000. Integrating data into decision-making has always been at the core of the business. However, since I joined two years ago, TI’s organisation of its data use has been continuously improving.
In this time, as a commercial team and working with our data analyst Aaron Fu, we’ve introduced a bespoke forecasting model using proprietary data and an in-house dashboarding tool. This has been a game changer in providing us with data-backed insights when looking at ship availability and cargo demand.
I’ve seen a shift in priority when it comes to the use of data at TI. Whilst industry connections are, and always will be important, there’s now a greater emphasis on the chartering desk using data than there was previously.
That said, relationships remain critical in any business and particularly in this industry. We have great relationships with leading NOCs and oil majors who often come to us direct with the cargoes they want to fix and we want to be fair and reasonable. We negotiated in good faith a standard set of terms with many of our frequent customers, which has increased efficiency and productivity during pre/post fixing, as well as protecting the interest of our Pool partners
When you combine our relationships with our economies of scale, plus using data to provide market insight and inform decisions – this is a killer combination delivering profitable journeys for pool partners and reliability for charterers.
How does Tankers International stand out among its competitors?
Let’s be straight – in shipping, size matters. We have one of the largest independent VLCC fleet sizes globally of modern, sophisticated tonnage. As a result, we can unlock economies of scale through our volume negotiations, and administrative costs associated with running the fleet. Furthermore, a large fleet allows for improved scheduling and gives access to a greater diversity of cargoes which means better financial performance.
Secondly, your fleet is only as good as the people you hire and the chartering, operations, and senior team have the best interests of our stakeholders in mind. In my team especially, we emphasise trust and transparency in our dealings to ensure the price is right.
Finally, while the industry is still figuring out how best to collect and use data, at TI we have powerful data, in large volumes, and we sure know how to use it! Our competitive edge is our data combined with the talent in our organisation that interprets it effectively. We recognise that we can’t have either one or the other; we must use both human talent and data together to truly leverage powerful insights.
The VLCC market is going through some significant transitions. While we have technically seen the overall number of ships in the fleet increase thanks to newbuilds combined with older ships not retiring, the older tonnage is increasingly less efficient, which is actually slowing down the effective growth of the fleet. This is further complicated by the rise of the “dark fleet,” where older ships are finding work in less regulated areas, often carrying oil from countries under sanctions.
Traditionally, VLCCs were typically retired around 18-20 years old, often scrapped or converted for storage. But things have changed. These older ships now have a new lease on life thanks to less regulated trades, especially those involving sanctioned oil. This has reduced the number of ships being removed from the fleet, and many are still operating well beyond their typical lifespan. It is now normal to see trading vessels aged up to 25 years.
Although these older ships can still operate, they are not as efficient as their modern counterparts. Our data shows that VLCCs up to 18 years in age, usually complete about 5 voyages a year. Younger ships often load in the Atlantic Basin, where terminal and charterer regulations are stricter and voyages are longer as many discharge in the Far East. But as ships get older, they tend to be booked for shorter routes from the Middle East to the Far East, allowing them to increase their voyage count to closer to 6 per year.
After 18 years, the decline in efficiency really kicks in. Our analysis suggests that older ships (between 18 and 25 years old) lose about 10% of their utilisation capacity each year. This drop is even sharper when we look at ships not involved in sanctioned trades, with their utilisation quickly dwindling to almost zero by the age of 20 due to their lack of mainstream charterer acceptance.
This ageing fleet has had, and will continue to have a significant impact on the industry. In order to understand the true state of the market, we therefore need to look beyond just the number of ships and consider other factors – for example, age, trading patterns and operational efficiency. While the nominal number of VLCCs has increased by over 100 units in the past five years, the growth in effective capacity, considering the declining utilisation of older ships, has been much lower, around 60 ship equivalents.
Looking ahead, this trend of declining effective capacity is not going away anytime soon. Even with new ships being built, the ageing fleet will continue to put a drag on effective supply growth. With 68 new VLCCs expected to be delivered in the next three years, we are looking at an 8% increase in nominal VLCC fleet capacity. However, due to the declining utilisation of older ships, the actual increase in effective capacity will be much smaller around 1%.
The result of the growing age imbalance is that the VLCC market faces a prolonged period of supply tightness, with competition for available tonnage intensifying, in particular in the mainstream market. This market tightness could likely result in an upward trajectory for freight prices.
Watch this space for further analysis as this plays out.
Our proprietary VLCC fixture data clearly reflects the changing nature of Middle East crude exports: a rise in sanctioned oil flows and a corresponding drop in compliant volumes.
Since 2022, OPEC+ production cuts, driven by non-OPEC supply growth and rising Iranian output, have reshaped the market. In the Middle East, Saudi Arabia, Iraq, the UAE, and Kuwait have reduced exports, while Iran has significantly increased theirs.
This shift has effectively transferred cargoes from the compliant tanker fleet to the “dark fleet”, a trend clearly visible in our VLCC fixture data as seen in these charts. Sanctioned crude liftings now account for 8% of the total VLCC liftings in the Arabian Gulf, double the 4% seen in 2022.
Looking ahead, potential increased US sanctions enforcement on Iran could reverse this trend, tightening compliant VLCC capacity and impacting freight rates. We’re monitoring the situation closely.
I’ve worked in the maritime sector for over 30 years, and I’ve experienced some dynamic moments during my time. I’ve been lucky to work for a range of different and unique companies from small shipowners focusing on Panamax vessels to large trading houses like Trafigura.
It was during my role at Trafigura that I started to specialise in demurrage – an indispensable and yet often overlooked element of shipping. When I left there, I was looking for a role that recognised the importance of demurrage and Tankers International was a great fit.
It was an exciting time to join Tankers International when I started in 2001 with lots of travel to introduce our team. Since then, we’ve had some impressive achievements, for example increasing the fleet to 70 plus vessels and outliving most other VLCC pools!
Overall, the team at Tankers International is positive about the claims and demurrage role and the present leadership team, led by CEO Charlie Grey is aware of the benefit of how my skills and expertise add to value to the pool, which is very motivating!
Can you shed more insight into demurrage claims in the tanker segment?
Demurrage is all about detail and requires a skilled eye regarding documentation – it’s much easier today as this documentation now comes via email as opposed to hard copies being sent off in the post. This means that certain elements of the claims processing have improved.
But challenges remain. There can be a lack of calculation standardisation between the Charterer and Owner, and we have to negotiate based on the information we have available which may not always be all the facts. As a result, it’s often the grey areas that require experience and a certain amount of trust to reach an agreement.
It is also important to note that charter parties rarely change, with some original contract wordings dating back to 1977 and due to this there are occasions when we find ourselves trying to interpret a term which may have had a different application when first drafted. Of course most Charterers use additional clauses to cover such discrepancies and other operational situations which may arise, but these are not always written in the clearest manner and therefore can also be problematic.
In my opinion having a dedicated person to handle this complexity is a must. Yet, in smaller companies, demurrage is often job-shared, with less priority placed on this important role, which risks missed revenue opportunities. We’re also seeing broader trends where demurrage teams are changing frequently, including new locations, which adds more challenges to claims settlement.
How does your role support Tankers International?
The claims and demurrage role will continue to evolve and remain vital. Over the years it has cemented its place as an integral part of shipping across all types of commodities. Whilst some commodities, such as coal, are less impacted by this source of income, the VLCC sector is more greatly affected.
Demurrage rates of VLCC fixtures can reach six figures, making this a valuable post-fixture revenue element. Under our contracts there is usually an allowance of five days to load and discharge the cargo meaning that with variables such as no room for the cargo, or waiting in the queue outside ports, demurrage is very often incurred.
As the world’s largest VLCC pool, we have the privilege of working with different Owners and Charterers on new routes and welcoming new vessels into our fleet. This requires new contracts to be finalised. Part of my role entails structuring the required laytime charter party clauses that this calls for.
How does Tankers International stand out in its approach to demurrage claims?
Tankers International is a progressive company and this is reflected in the way it handles demurrage. We have a bespoke system that works out the calculation for demurrage, but this is supplemented by the expertise of the Tankers International team, which balances the Owner and Charterers’ preferences.
We are transparent with regards to how we report demurrage collection information back to the pool partners, with biannual reporting on demurrage. If requested, we can also add value to our pool partners by advising them on demurrage claims based on our detailed database.
At Tankers International, we pride ourselves on negotiating with new counterparties and developing new relationships. Our business is always changing globally, and due to our size, we understand the importance of having a dedicated person handling demurrage.
What have been your personal highlights during your time at Tankers International?
I would have to say a recent panel discussion at the Oil Operations & Demurrage conference was a real highlight. I was part of a panel, sharing my views and knowledge on the topic of Ambiguous Clauses in Sales Contracts and Charter Parties. Most of my work is behind the scenes and getting out there to discuss this vital role with fellow professionals was a great experience – I look forward to speaking more on the subject to generate more awareness of the importance and value it can deliver.
As the new year begins, Mette Frederiksen, Head of Research & Insight at Tankers International, shares her perspective on the 2024 market, leveraging insights from the pool’s proprietary fixture data. She also explores how oil and freight dynamics have reshaped the VLCC market over the past year, with predictions for 2025.
Reflecting on 2024
At the start of 2024, the global shipping industry saw encouraging signs and was optimistic about the year ahead. Key forecasting agencies projected strong oil demand growth, driven primarily by China and other nations East of Suez. At the same time OPEC’s production cuts seemed set to be counterbalanced by non-OPEC suppliers expanding their output, particularly in the Atlantic Basin West of Suez.
The temporary removal of Venezuelan sanctions also reshaped the market going into 2024, integrating previously sanctioned trades into mainstream operations while geopolitical events in other parts of the world caused disruptions and delays.
All these factors pointed to increased tonnemiles and vessel demand – especially for trading routes running West to East. With vessel supply stagnant or in decline, the basic principles of supply and demand suggested an upward trajectory for freight prices. However, the reality of 2024 did not fully align with these high expectations.
Oil demand growth
Throughout 2024, revisions from forecasting agencies downgraded global oil demand growth by approximately 400,000 barrels per day (bpd). This adjustment closely mirrored downward revisions to China’s growth forecasts, which dropped by more than half a million barrels through the year
China’s oil demand remains a key driver of tanker markets and in 2024, the impact on the VLCC sector was twofold: slower-than-expected demand growth dampened overall market activity, and increased reliance on sanctioned oil further skewed dynamics.
Approximately 2.7 million bpd of China’s seaborne imports in 2024 originated from sanctioned countries, including substantial volumes of Iranian crude. We also saw Russian crude following to China, but much of this bypassed the VLCC market, instead utilising smaller tankers. Overall, shadow fleet activity into China diverted around 20 VLCC fixtures per month from the mainstream market.
Despite these challenges, there are signs of potential recovery. In November, Chinese refiners began sourcing more non-sanctioned crude from the Middle East and West Africa. This shift reflects both increasing U.S. sanctions pressure and rising costs associated with sanctioned oil.
As we now enter 2025, agencies forecast global oil demand growth of 1.1 to 1.4 million bpd, aligning with long-term averages. This suggests that, while 2024 was challenging, the broader demand outlook remains stable.
OPEC+ vs. Non-OPEC production dynamics
OPEC+ remains a key influence, with plans to reintroduce 2.2 million bpd of voluntary production cuts over an extended 18-month period starting in April 2025. The phased return of these barrels, primarily from Middle Eastern countries, could add demand equivalent to 55 VLCCs if directed to Eastern buyers.
While OPEC+ kept voluntary cuts in place through 2024, non-OPEC production growth, particularly from the Atlantic Basin, remained robust. However, realised growth fell short of initial expectations due to slower-than-anticipated growth from Brazil and lower-than-expected US exports. Furthermore, with China not drawing as many barrels from the Atlantic Basin, Atlantic exports remained largely within the West of Suez region, leading to shorter voyages and lower tonnemile demand. Looking ahead to 2025, projected non-OPEC production growth of 1.1 – 1.7 million bpd, with the majority expected from West of Suez producers, could drive significant West-to-East oil flows, benefiting VLCC demand.
Tonnemiles and fleet development
2024 saw fluctuations in vessel demand, including an unseasonal dip in September and October, followed by a recovery in November. Overall, spot market demand ended the year around 5% below 2023 levels.
The VLCC supply side continues to be fundamentally positive:
The orderbook remains historically low at just 80 vessels (8% of the trading fleet)
The fleet’s average age has reached 12 years, with over 100 vessels now 20 years or older
Over the next four years, the number of vessels exceeding 20 years will double, representing 21% of the trading fleet.
With only 80 newbuilds in the pipeline, the effective fleet size is poised to decline as older vessels become less efficient. Add to this a large pool of older, exit-ready ships, the medium-term fundamentals are promising.
Looking forward into 2025
The market dynamics of 2024 resulted from a convergence of small events that collectively enforced downward pressure on freight rates. However, the fundamentals for 2025 suggest a more optimistic outlook:
Non-OPEC supply is projected to have strong growth, and most of this is West of Suez
OPEC+ production is set to gradually return to the market, potentially bolstering VLCC demand
Geopolitical challenges remain a persistent factor, contributing to inefficiencies and supporting tonne-mile demand
Fleet constraints could lead to an effective decline in vessel availability, exacerbating market tightness.
The main wildcard remains China. Both the growth of its oil demand and its sourcing patterns will be crucial in determining the trajectory of VLCC demand. If fundamentals align, 2025 could mark a significant turning point for the freight market.
Tankers International remains cautiously optimistic; we believe that 2025 holds the potential for a market recovery driven by robust fundamentals and a balanced fleet dynamic.
